« | Home | »

Houston, Wii Have a Problem

posted on October 30th, 2009 by tyson

When the Wii was first heralded as the “next big thing” in video games, I was watching from the sidelines (or possibly the frontlines) in Japan. I admit that like everyone else, I got caught up in the hype and wanted…nay…needed a Wii. That was a couple of years ago. Since then, I have decided a didn’t need a Wii and then ended up getting one for practically free off of Craigslist about five months ago. I haven’t played the damned thing in almost three months, confirming my suspicions that the Wii was not a console for me. However, this is not a blurb of why I dislike the Wii; it is an article explaining why I think the Wii was a bad idea for Nintendo.

At first glance, the Wii was a nifty concept. Instead of a controller, you get a wand that you wave like a madman at your television and stuff happens. People seemed to enjoy the idea of having to play games standing up (though I have never understood why) and actually going through the motions of the activities portrayed on the screen. Then the tech specs for the machine were released and pundits (including me) figured out that the Wii was severely lacking in pretty much every department other than ingenuity. Nintendo explained all of this away by saying that the console was not meant for the hardcore gamer, rather the hardcore gamer’s grandma and the hardcore gamer’s girlfriend. Sometimes, those two niches were filled by the same person, depending on the hardcore gamer.

The design and marketing of the Wii made financial sense for Nintendo too. At a time when the company’s only profitable platform was the DS, a console that made the company money as soon as a unit was sold was a boon. The bottom line was that Nintendo could not afford another Gamecube sales debacle and needed cash fast. While they people at Nintendo may be creative geniuses, they could not accurately project the future of the system or the industry and due to this lack of foresight, Nintendo is once again in a bind. This time, I do not see Nintendo recovering.

Today, the Wii is doggy paddling in the console market. Sony has announced that they too will soon have a Wiimote and games that cater to it. Microsoft has announced “Project Natal” which will take Nintendo’s original idea one step further with motion sensing cameras and whatnot. Neither Sony or Microsoft’s ideas are original, Sony is copying Nintendo and Microsoft is essentially marketing a Sony Eyetoy on crack. But as soon as they are released, both gimmicks with threaten Nintendo. Why buy a Wii when you can buy a PS3 that behaves like a Wii and plays Blurays and standard PS3 fare? Yes, the PS3 is a more expensive system but I think enough value will be there to draw prospective buyers away from Nintendo. Microsoft’s one big draw is and always has been Xbox Live and while Sony and Nintendo have struggled in the online component of their systems, Sony is quickly making up ground. Nintendo is not.

More troubling news has come out of Nintendo in the last couple of days with their announcement of a DS with a bigger screen called, DS LL. Is this a brand new DS filled with awesome, new, and innovative hardware? No, it’s a DS with a bigger screen. That’s it. A bigger DS coupled with the rumor that the Wii will soon get an upgrade that will enable it to play DVDs and display video at higher resolutions than 420p are nothing more than marketing gimmicks stolen directly from Sony’s crappy playbook. Where is the innovation, Nintendo, c’mon?!

Unfortunately, this lack of hardware innovation is trickling into the games that find themselves on the Wii. If IGN’s list of upcoming Wii games and their release dates is any indication, only a handful of new and original titles are to be expected between now and the end of 2011. This may partially explain why Nintendo’s total global profits fell 54% compared to this time last year. Nintendo keeps allowing crappy franchises and movie licenses to thrive on their systems and have basically made themselves the town whore to any kids show or movie that offers them money to make a game (in name only) for one of their systems. For a while, Nintendo talked about bringing back their Nintendo Seal of Quality that used to grace the games of old. Sure, it was a horrible pain for game developers, but lets face it, the NES and SNES had some damned fine games and the Wii and DS could use that kind of fascist quality control. Will the Nintendo Seal make a comeback? I doubt it, Nintendo needs money and turning away prospective publishers doesn’t make money. I think I have spewed enough facts to illustrate where I think Nintendo is going.

Down.

I am nowhere near a professional analyst but if I were in the prediction making business I would say that within two or three years the Nintendo we know will be dead. That is not to say that they will go the way of the original Atari and totally disappear from the face of the Earth, but I do think the Wii and the DS franchises will be Nintendo’s last foray into the console market. My guess is they will pull a Sega and just sell all of their original franchises to Sony. Why Sony and not Microsoft? Easy. First, Sony is a Japanese company and most Japanese companies cooperate with each other to some extent, even if they are in direct competition with each other. Remember, the original Playstation was supposed to be a Nintendo and Sony joint effort. Second, Sony’s PS3 has a higher market saturation in Japan than Microsoft’s Xbox 360 and so it would make sense to keep Nintendo’s brands on a system that Japanese people actually play. If Nintendo were to give say, the Mario franchise to Microsoft it would basically be to send Sony a parting, “screw you”.

Another likely possibility would be that Nintendo decides that the home console market is too hard to compete in and focuses solely on their mobile market share. While the DS has seen a flood of crappy games, it also sports a very diverse selection of titles. You have a ton of RPGs, casual games, side-scrollers, imports, etc. Focusing solely on the DS would allow Nintendo the free money to enforce some sort of quality control by denying developers the right to keep making games like Dora Visits Thailand and Snoopy Eats A Bagel. It would also allow Nintendo to develop a new handheld device with more innovation than a bigger screen. Most importantly, by going this route Nintendo could maintain all of its original franchises without pimping them out to Sony. I for one would definitely go for a sequel to the New Super Mario Brothers.

The bottom line is Nintendo has painted itself into a corner. Sure it made a Wii, but it wasn’t able to lock its competitors out of the market and it doesn’t have enough horsepower to fight Sony or Microsoft’s offerings once they bring comparable products to market. The counter to this would be to say that Nintendo has brought superior games to its platform and I think we can all agree that aside from a dozen or so games, this has not happened. At all.

Part of me is saddened by what I see coming because unlike any other game company, Nintendo has grown up with me. I was five or six when the NES was released and have had every system since. The other part of me sees this as a good thing. I have always been fond of Nintendo’s handhelds and I don’t see that changing anytime soon. I would also kill to see a traditional Super Mario Bros. game on the PS3 after having experienced the sheer joy that is Little Big Planet. One way or the other, Nintendo has passed the point of no return in terms of being able to correct itself as the company we are all familiar with. Now we just have to sit back and see where Nintendo takes itself in the next couple of years.

1 Trackbacks/Pingbacks

  1. Pingback: Numbers Are Fun – Back by Popular Demand | videolamer.com on November 10, 2009

16 Comments

  1. jay said on October 30, 2009:

    I disagree with almost all of this but would like to address the thesis that Nintendo is in a bind with a graph:
    Wii vs PS2

  2. pat said on October 30, 2009:

    i share several of your frustrations with the wii, but like jay, i disagree with a few of your conclusions:

    1. hardware manufacturers seem very unlikely to quit making hardware after dominating a generation. it took two disappointments (in terms of sales; i happen to love both consoles) for sega to stop making hardware. the idea that nintendo will be out of the hardware game anytime soon is far fetched.

    2. nintendo profits were down for a number of reasons, such as having much of their costs denominated in yen and sales denominated in non-yen. in an absolute sense, sales and profits were still quite strong (for the industry), just not the obscene numbers we saw last year. we will see what the holiday season brings.

    3. by most measures, nintendo has been much more innovative than either sony or msft this generation. the route of new control schemes was a creative strategy when all sony and msft could think to do was add more processing power. i do not see how nintendo is the one lacking innovation in this scenario. while i will grant you that the re-skins of the ds may be more “milking” than “innovation” i don’t see how this is worse than what sony has done with the psp hardware updates.

  3. christian said on October 30, 2009:

    Even if Nintendo profits are down, it is still profts. Sony meanwhile continues to lose dough on the PS3, and it may not be profitable until next year. They have a lot of gas in the tank.

    I also think that they are in a slightly different position in the past. Right now, the Wii is similar to its predecessors – no one outside of Nintendo cares that much about it, or puts any work into their games, but Nintendo’s own sales numbers are no longer high enough to keep them afloat – now they make far more than that, enough to roll in the dough. And they can keep on doing that as long as they keep the Wii (or its successor) as a must have item in the eyes of the general public. If they do not, it would still take them a while to lose the fight.

    From a games perspective, I am 50/50 with them. I have a nice little DS library, and if I wasn’t on such a PSP kick I’d be buying even more. As long as they keep making games I can play on my Lite, I don’t care how many remodels they make. My Wii library, on the other hand, is anemic. I bought it at launch, and have as many or more games for the PS3 (owned since last summer) and the 360 (which I don’t own at all). Part of this is due to their being less games on the console which I am interested in. More than that is the fact that the games I am interested in didn’t excite me. Twilight Princess, Smash Bros. Brawl, and even Mario Galaxy were all pretty boring for me. Five years ago I would pick up any first party Nintendo title on day one. Now I still don’t own Mariokar, Punch Out, etc, and I’m not sure if I ever will. Those disappointments made me hesitant to trust them.

    But even if I find myself buying less Nintendo games, or even still, less of their future consoles, it doesn’t bother me. I’m not mad at them, I don’t feel betrayed. They do their thing and I do mine, and as long as it keeps them going, so be it.

    Still, I do have a comment on what I perceive as a drop in quality. I think a lot of is due to them being afraid to be different. The Nintendo lineup on the Gamecube was, for me, some of the finest software they ever made. They did the 3d thing for the first time on the N64, and then they decided that if they were going to do it again on the Cube, they’d have to have a reason that wasn’t just ‘we need a sequel’ So they expeirmented, and for the most part, gamers did not take kindly to it. So the same brands come out on Wii with rather pedestrian experiences that tread all the same ground as before (and are sometimes more conservative than on the Cube), and suddenly people are back to praising them. They also tried to make brand new games, mostly to little success. I think Wii Music is one of the most interesting things I have played since 2006. I don’t understand the bile. So I see a future in which even Wii Music is too exotic, and Nintendo chugs along with sequels to Wii Fit and Sports, or another Zelda that makes you go through the motions, and I cringe. Then I cringe again when I realize that this is being encouraged.

    Probably one of the most frustrating things I’ve experienced in this regard are people trying to use Metroid Prime Trilogy in their arguments of the Wii having a strong library. If they were doing so to convince casual gamers, I’d agree. But these folks are saying that to other longtime Nintendo fans? Why? I’ve already played those games. I own them. Love them. I want more of that. But it would be silly to rebuy them simply due to a new control scheme. Why should I be pleased with that? Why are THEY so pleased with that? The modern Nintendo fan boggles the mind.

  4. Tyson said on October 30, 2009:

    Like I said in the article, I don’t see Nintendo just up and dying tomorrow and a lot of my predictions are also reliant on Sony and Microsoft making good games for their new control schemes. My biggest fear for Nintendo is that a lot of developers who would have made games solely for the Wii will start porting their wares to the PS3 as well. As it stands now, Nintendo has a monopoly on the “goofy games I can use a Wiimote on” market and this has been good for them. If Sony starts biting into that niche, Nintendo loses out.

    I love Nintendo too but I see a definitive drop in quality like Christian mentioned. You can say that Sony and Microsoft haven’t been great in that department either but for them, it doesn’t make that big of a difference. Yes, Sony loses money on each PS3 sold but unlike Nintendo, the game console is not Sony’s only vehicle for making profit. The same can be said for Microsoft. For Nintendo, the price of failure is much greater.

  5. christian said on October 30, 2009:

    Good post Tyson. I’d argue that Sony have been on a quality kick in at least one area. Their offerings of PS1 classics have been increasing tremendously, and at a fair price. Meanwhile their PSN originals have been very experimental. Just recently they put up yet another demoscene product for cheap. Contrast this with Nintendo almost giving up on the Virtual Console.

  6. ECM said on October 30, 2009:

    I pretty much disagree w/ all of this, and the fact that it sounds like an article dug up from 2004 (Nintendo is doomed; going 3rd party; blahblahblah) doesn’t help.

    I think it’s more accurate to say that Nintendo has some near-term challenges to overcome (the DSiLL is actually a fantastic idea–whether it ultimately pans out in broadening the audience to the 65+ set remains to been, however), but it isn’t even remotely as dire as you’re armchair analysis is making it sound.

  7. chris said on October 30, 2009:

    I don’t see Nintendo going anywhere for at least a generation. “Our profits are no longer astronomical, merely stratospheric” will not be causing any boardroom to go into a panic anytime soon (much less Nintendo’s).

    If Nintendo didn’t quit after the N64 and the Gamecube, they’re sure as hell not going to quit when their console has been doing the best sales-wise of them all (not to mention their portable prints money).

    I personally find the PS3’s offerings more interesting than the Wii’s in the near future, but I think it’s short-sighted to make any assumptions about what will happen to the market based on personal tastes. Yes, I may barely play my Wii – and I may not know anybody who does much – but so far the sales numbers indicate the Wii is still in charge.

    They’d have to really trip up to actually start losing money at this point. Something like not releasing any more 1st-party games, losing what 3rd-party support they have, and having each of their regional headquarters burn down in a freak coincidence is just about the only way that could happen.

  8. Cunzy1 1 said on November 2, 2009:

    As a thought experiment it is interesting to see this kind of piece but am I the only one who is sick of seeing these articles (and Ctrl H Wii with PS3 or Xbox 360 depending on your flavour) based purely on hype and Fanboy chatter? I want to see an article with some fucking evidence in it. And I want to see that evidence analysed by someone who is actually properly equipped to process it.

    It should combine things like clear lifetimes sales for consoles and games (and I mean lifetime across all territories, not just ‘last week’ or ‘in the US’), I want to see actual figures for attach rates. What are the average number of games per household? How long are individual play sessions? Who buys the games? How old are they when they are bought? Has the average bought game been out a day? Week? Month? Years? How long do they play? How many games do people have for their console and how often do they buy games (again all territories, all time) I also want to see how review scores match with take up. I want to see facts and figures on the download market. Virtual console titles per Wii? PSN Games per PS3? How many people actually have their console online? How many people know about virtual console, PSN, XBLA? How many people are still putting hours in to their Gamecubes or PS2s? If the second hand market is so ‘bad for the industry’ why can’t I buy the great games of last gen on the high street? What is the average number of controllers per console? Why can’t I buy any games direct from the developer or publisher? I want to see how long people are playing games for and I want to see how people buy their games, what they use to influence their decisions and which devs and console makers maintain interest in titles over the long time through advertising and special offers. How does this compare to the consoles of yesteryear? How have different strategies worked in the past? I want to see all this information combined with how many hits the big gaming websites get and whether certain mags have more influence on who buys what. Only then can we start to make informed predictions about this kind of thing.

    And you’d be hard pressed to find all that information because if you had it you could rule the roost. I bet some companies have some of this information but you’d have to buy it to get access to it. Also, a lot of this information just doesn’t exist. The games industry is still very much geared to making the next buck and not at all interested in long term sustainability or gaming heritage. Until then fanboys will continue to make predictions based on how last week’s big seller fared rather than what is actual happening in houses across the globe. Until then all this is is an opinion piece framed by personal experience and the odd leading statistic.

    And we can all do opinion pieces:
    I’ve never even stooped to buy an Xbox 360 or PS3. Live for 360 is simeultaneously the best and worst thing about it coupled with a shaky catalogue of games, few of which are to be considered true gems. Oh you want to play an RPG or Platformer? Sorry the 360 only does FPS and driving games unless you go to the arcade but then thats basically HD versions of PSOne games. The PS3 is exceptional in that we now have a slimline version of a console which is even less useful than the original PS3 (when backward compatability wasn’t such a huge turd fest). Where are the games? It’s been three fucking years and according to metacritic (this is just one source it’s not the definitive) five of the top ten games have the number four in their title and only 3 of the top ten are PS3 exclusives. All the while the gaming blogoshpere seems obsessed to keep fighting the console war but in reality ‘gamers’ have very little clue about what is doing well and what is doing badly.

    This is no personal sleight against you Tyson and you see this kind of article everywhere (I’m guilty of writing quite a few) I’m just doubtful that the blogosphere will every have all the information they need to start making accurate predictions based in reality rather than just nerdrage.

  9. jay said on November 2, 2009:

    Actually a lot of this info does exist. I am contemplating writing something on how Sony has lost everything they made on the PS1 and PS2 with the PS3. Which is still selling at a loss, incidentally.

  10. Cunzy1 1 said on November 2, 2009:

    Some of the information exists but there are a lot of gaps. It all needs pasting together. Perhaps a Videolamer four piece (Microsoft Consoles, Sony, Nintendo and PC/Mac) on the State of the Game is due?

    Just something sensible and clearly put together so we can start anchoring some of these points with incotrovertible up to date evidence.

  11. pat said on November 2, 2009:

    i used to write on these topics occasionally, but the project, which was always labor intensive, became too arduous once a couple of my better sources dried up.

    a few examples:
    http://videolamer.com/numbers-are-fun-year-end-edition
    http://videolamer.com/numbers-are-fun-year-end-edition-the-handhelds

    my author page has more:
    http://videolamer.com/author/pat/page/2

    some of what cunzy is asking for is available and i may try to gather some data (or subcontract the research to jay) and do an update. the most relevant chart is what jay posted; worldwide the wii is still tracking better than the ps2, which makes it a monster. it may be impossible to get a comprehensive picture of much of the player profile (hours played etc) stuff, but raw sales (worldwide and by region) should be possible, it would just take some work.

    for the record, i think tie ratio is mostly irrelevant; at least far less relevant than either stat (total hardware sales and total software sales) that composes it.

  12. Cunzy1 1 said on November 2, 2009:

    But I think tie ratio in the first instance gives a really clear picture about what we mean by the ‘average gamer’. i.e. is it the person writing the article who has 300 games for 12 different platforms or is it actually someone who typically will have 6 games per console (both are made up examples). Also, if we can find the accompanying data for the average time people have owned a console it becomes apparent that people may buy a game once every two months. Then compare this with data for how long games stay on shelves and how many people buy the games from retail and we can start to make suggestions about why people buy the games they buy.

  13. Tyson said on November 3, 2009:

    I agree with you, Cunzy, that an article like what you suggested would be interesting. Unfortunately, I am lazy and there is no way I am dropping that kind of time researching something that I am not getting paid to research and write on. I look forward to someone writing said article if they do have the time though.

    Jay, I didn’t think the PS1 made Sony that much money either. I thought most of their profits came from the PS2 days when they were pretty much the only decent system around.

    I will say that I own all three of this generation’s game consoles and I am not particularly biased for or against any one company. I think Sony has a great console but I really don’t like Sony as a company and I think a few more games need to come out that drive people to the PS3. I think what the Xbox 360 has done for online gaming is amazing but you have to scrounge for games that can be considered “classics”. As for Nintendo, I have grown up with them and have a history filled with love and awe for that company. However, I have some major issues with Nintendo’s lack of quality control as of late and I am not a particularly big fan of the Wiimote and Nintendo’s insistence that every Wii game needs to use it in some way.

    There, now you all know where I am coming from. 😛

  14. Tyson said on November 3, 2009:

    Also, I am sorry if you guys have seen a lot of articles like this one on other game sites. I don’t visit many videogaming blogs or fansites and so I don’t have too good of an idea what gets written about frequently and what doesn’t. I just write about things I feel strongly about.

  15. christian said on November 3, 2009:

    No problem Tyson. I think it is still good to reevaluate each company from time to time. I know that I have felt differently about each one at different points in this generation.

  16. Michelle said on November 3, 2009:

    Tyson your views on the Wii early on in your piece tie up pretty well with my own, although I think you lost me near the end, I can understand the general sentiment even if I don’t completely agree with it.

    I think Nintendo are doing me a huge favour with the Wii, it’s forced me to look elsewhere (other than Nintendo) to find the sorts of games that suit my particular interests. It’s opened up tons of new conversations with those I’d describe as non-gamers who are now more keen to approach me and start conversations about games, that simply would not happen before I feel like I have more common ground with people now.

    I got into Nintendo rather late (the Gamecube was the first Nintendo console I bought at launch, I missed the whole N64 era and experienced it all retrospectively, and I was a HUGE SEGA fan in my youth. For me now my favourite developers are easy come easy go, after watching SEGA effectively fall apart for a few years, I can’t help but feel the same for Nintendo now, that lovely little bubble generation I had with them for the Gamecube was one of the best gaming moments of my life, but direction wise they’ve clearly changed tack a little, and infuriating as that is for some people I think it’s something we just have to start to deal with.

    I do think they will go downhill a little profit wise from here on in – but only because they cannot continue at the phenomenal rate that they are forever, I expect a small slump soon but nothing company-breaking.

    What I do find genuinely interesting though is the success of the DS which is even most startling, you have to wonder if the Wii would have done quite as well commercially (in such a short period of time) without the DS to help with the hearts and minds campaign.

Leave a Reply